Offices in Colombo, Sri Lanka and Israel
Economic update· 2 min read
Sri Lanka’s economy continued to show impressive signs of recovery through 2025, strengthening investor and business confidence. Q2 data point to broad-based growth driven by higher exports, rising remittances and stable inflation.
GDP grew 4.9% in Q2 2025, after 4.8% in the first half, marking eight consecutive quarters of positive growth since mid-2023. Industry led with around 8% growth (construction, textiles and manufacturing), services grew more than 3% (tourism, technology and financial services) and agriculture held steady.
After almost a year of deflation, the Colombo Consumer Price Index rose 1.2% year on year in August. The Central Bank expects inflation to rise gradually towards its 5% target. The policy rate remained at 7.75%, and both manufacturing and services PMIs signal expansion.
Official reserves rose to around USD 6.2B, and the rupee weakened by only about 3% year to date.
On 19 September 2025 S&P raised Sri Lanka to CCC+ with a stable outlook, formally ending the selective-default period, following progress on economic reforms and debt restructuring under the IMF programme.
The Yala-season paddy harvest rose about 11%, while tea and coconut output was mixed due to weather. Fisheries dipped in June but are expected to recover by year-end.
The outlook for the rest of 2025 is cautiously positive: growth continues, inflation is contained and external buffers are solid. Sustained structural reform and public-debt management are needed to turn macro gains into real improvements in welfare and investment opportunity.
Source: Monthly Economic Update – September 2025 (CBSL / Ministry of Finance)
On 19 September 2025 S&P upgraded Sri Lanka to CCC+ with a stable outlook, formally ending the selective-default period.
GDP grew 4.9% in Q2 2025 and 4.8% over the first half of the year.
Travel & visas
Ten days is enough for a balanced route from Colombo to Kandy and tea country, then a safari and a finish on the south coast. Seven days means a conscious cut — usually fewer beach days or skipping a region — and should be built around the season, not as a race between sights.
Read moreTravel & visas
There is no single “best” month for the whole island. December–March is especially comfortable for the south and west coasts; July–September suits the east coast and safari. October is usually the least settled month. Build the route around the region, not only the departure date from Israel.
Read moreTravel & visas
A business visit to Colombo can grow into a few tour days — Sigiriya and Kandy, tea country, or the south coast — without turning the whole week into back-to-back meetings. Keep a recovery day after the flight, cluster meetings in Colombo or Port City, and plan the touring days in a single stretch, matched to the season.
Read moreFree initial consultation
Speak with our team in Israel or Colombo for the full brief, documents and a discreet site visit.
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